Stop Undervaluing Yourself: The Coder's Guide to Raising Your Rates in 2024
Are you a coder struggling to make ends meet or constantly feeling undervalued? Learn from my mistakes and discover how to set rates that reflect your worth. This isn't just about making more money; it's about building a sustainable and fulfilling career.
The Hourly Billing Trap: Why It Hurts Coders
Hourly billing is a flawed system that penalizes efficiency. As Jonathan Stark of Ditching Hourly points out, it incentivizes slow work or padded timesheets. Your goal as a coder should be to deliver value, not rack up hours.
- Discourages Productivity: The faster you work, the less you earn.
- Compromises Honesty: Temptation to inflate hours is always present.
- Constant Financial Anxiety: Focus shifts from problem-solving to hourly earnings as a software engineer.
The Layoff Panic and the Race to the Bottom
Like many coders, a layoff sent me into a frantic job search. Blindly applying everywhere, I even faced rejection from FAANG. Desperation led me to make a critical error: lowering my rates.
My former coworker suggested I lower my rates due to the 2024 job market slow down. High interest rates and the rise of AI seemingly made the demand for software engineers decrease. However, that can't be further from the truth when there's a demand for quality over quantity.
The "Cheap" Coder Revelation
During an interview, the client explicitly said they wanted someone "cheap" for a repetitive app migration. This was a wake-up call to set aspirational hourly rates (a lesson from Naval Ravikant):
- Ego Check: The comment stung, highlighting the undervaluation.
- Forced Acceptance: Emergency funds dwindling forced me to accept the "cheap" label.
- Matrix Escape: Reinforced the need to escape the hourly rate trap and value my skills.
How to Confidently Choose Your Coding Rates
Stop pulling numbers out of thin air! Gerald Weinberg's "The Secrets of Consulting" offers valuable advice on setting rates: choose a rate you're comfortable with, whether accepted or rejected. Avoid rate remorse and use this practical approach:
- Comfort Zone: Select a number that feels fair to you and the client.
- "Slap Test": (Humorous) If your rate offends, you're likely charging too low.
- Know Your Value: A confident coder is a well-compensated coder.
Your Coding Career Deserves More
Like me, you probably need to raise your rates as a coder. Don't let fear or desperation dictate your worth. Value your skills, charge accordingly, and build a rewarding coding career.
Are you ready to take your coding career to the next level? Join my free 7-day email course to refactor your coding career and save years and thousands of dollars' worth of career mistakes.
